Shanghai Fosun Pharmaceutical (600196) H1 2024 earnings summary

Executive summary

• 1H24 revenue was RMB 20.46 billion, down 4.36% year-over-year due to a sharp decline in COVID-related product sales, but innovative drug revenue exceeded RMB 3.7 billion and grew steadily.

• Net profit attributable to shareholders was RMB 1.225 billion, down 8.64%–31.09% year-over-year, mainly due to lower non-recurring gains and COVID-related sales.

• Operating cash flow improved 5.36% year-over-year to RMB 1.91 billion, supported by supply chain and operational efficiency.

• R&D investment remained high, reaching RMB 2.74 billion (13.38% of revenue), focusing on pipeline integration and innovation.

• Over RMB 2 billion in asset disposals or agreements since 2024, optimizing asset structure and cash flow.

Financial highlights

• 1H24 revenue: RMB 20.46 billion (down from RMB 21.40 billion in 1H23); innovative drug revenue up, COVID-related product revenue down.

• Gross profit: RMB 10.00 billion, gross margin 48.9% (down from 50.0% in 1H23); gross margin minus selling expense ratio improved 1.72pp.

• Net profit attributable to shareholders: RMB 1.225 billion, down 8.64%–31.09% year-over-year.

• Basic and diluted EPS: RMB 0.46, down 31.34% year-over-year; ROE: 2.66%.

• R&D expenses: RMB 2.74 billion (13.38% of revenue); pharma R&D intensity: 16.39%.

Outlook and guidance

• Focus on innovative drug pipeline, international expansion, and operational efficiency.

• Continued asset optimization, lean operations, and cash flow management to support sustainable growth.

• Ongoing launch and registration of new products in China and overseas, including key approvals in the US, EU, and Japan.

• Medical devices and diagnostics to expand product lines and internationalization; healthcare services to deepen integration and digital transformation.